Graincorp offers to buy Ridley

Grain handler Graincorp Ltd has offered to buy livestock feed maker Ridley
Corp for $415 million. Ridley has responded to the offer, recommending its
shareholders take no action.

"This is an unsolicited, conditional takeover offer by
GrainCorp and we urge shareholders to take no action until the offer is reviewed
in detail by the board," said Ridley chairman Dr John Keniry.

Graincorp
is offering one of its shares for every nine Ridley shares, representing an
implied offer price of $1.39 per Ridley share, based on Graincorp's closing
price of $12.48 on May 15.

"We view the result as positive. There are
potentially a lot of synergies across both companies and the combined group will
make a very strong business," said Jason Teh, a fund manager at Investors Mutual
Ltd, which holds Graincorp's shares.

Shares in Ridley, Australia's
biggest feed maker according to its Web site, rose as much as 11.5 per cent
after the announcement, but later pared gains to stand 6.9 per cent higher at
$1.39 by 1452 AEST, suggesting investors were not expecting a higher bid.